U.S. government agency in charge of financial stability weighs in on climate change risks

U.S. government agency in charge of financial stability weighs in on climate change risks

The Treasury Department's Financial Stability Oversight Council on Thursday released a report assessing the risks a changing climate poses to the U.S. financial system and providing recommendations for protecting the economy. The council issued the report in response to President Joe Biden's executive order on Jan. 27 that directed Treasury Secretary Janet Yellen, the head of the FSOC, and financial regulators to produce a report on climate-related financial risk data. The blueprint could potentially move forward new regulations and oversight related to climate-based financial risk on Wall Street. Climate-related disasters such as heat waves, drought, floods and wildfires have grown more frequent and threaten to upend the stability of the financial system. In 2020 alone, a record number of disasters caused , according to the National Oceanic and Atmospheric Administration. The FSOC's report also accounts for how climate change will likely create abrupt shocks to the financial system in the coming years. Different sectors will experience stresses as policy, consumer sentiment and technologies shift in order to mitigate climate change, the report said. For instance, a Commodity Futures Trading Commission panel last year cited data estimating that between connected to fossil fuels could be destroyed. Here are the FSOC's main